Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Vortex Company operates a retail store with two departments. Information about those departments follows. Department A $845,000 470,000 Department B $455,000 295, 750 Sales Cost
Vortex Company operates a retail store with two departments. Information about those departments follows. Department A $845,000 470,000 Department B $455,000 295, 750 Sales Cost of goods sold Direct expenses Salaries Insurance Utilities Depreciation Maintenance 117,000 10,000 22,500 19,500 7,000 87,000 10,500 25,000 14,000 5,300 The company also incurred the following indirect costs. Salaries Insurance Depreciation Office expenses $35,000 8,000 14,200 40,000 Indirect costs are allocated as follows: salaries on the basis of sales; insurance and depreciation on the basis of square footage; and office expenses on the basis of number of employees. Additional information about the departments follows. Department Square footage 28,000 12,000 Number of employees 77 33 Required: 1. Determine the departmental contribution to overhead and the departmental net income for department A and Department B. (Do not round intermediate calculations. Round your final answers to nearest whole dollar.) VORTEX COMPANY Departmental Contribution Statements Department Department $ $ 845,000 470,000 375,000 455,000 295,750 159,250 Sales Cost of goods sold Gross profit Direct expenses Salaries Depreciation Insurance 117,000 19,500 10,000 22,500 7,000 87,000 14,000 10,500 25,000 5,300 Utilities Maintenance 176,000 141,800 Total direct expenses Departmental contributions to overhead Allocated indirect expenses Salaries Office Insurance Depreciation OOOO
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started